I suggest you make every effort to promote the peace, and by that I mean you should find in yourself the means, the courage and the decisiveness to completely defuse the situation before it gets out of hand. The burden is on you.
I am not saying that I agree with your neighbor's attitude. I find it very disturbing for what it can potentially develop into. But this is one of those things that you have the power to control---at least from what I gather---and for that reason it is all the more imperative that you do whatever it takes to keep the war from escalating.
Ah, but he bad-mouthed you and your squeeze.
So what.
Sure, it takes a lot of inner strength to swallow the offense. Not everyone is born with that kind of moral fiber. But then, you're supposed to be the better man---am I correct? Maybe the dope had a rough day at work and needed some R&R to keep his nerves from cooking off. When your volume exceeded the reasonable limit, he naturally got pissed. Who wouldn't, for cryin' out loud.
Give him a break. He's entitled to as much peace and quiet as you are. You never mentioned him being anything more than a 220 lb sourpuss, so I won't assume he's a stewed-up, criminally insane lunatic whose only drive in life is to take yours. If he threatens to get physical, do what you did and call the cops. If not, ...well...at least you know what bugs him. You can't say later that you had no clue.
Curiously, I find myself more often in the opposite situation. To wit, my neighbors are a bunch of rowdy, no-good, hyper-emotional meat-heads who lack even the rudiments of polite society. Every month or so they'll throw an excrutiatingly loud party in their backyard, with all the trappings of a wild bacchanalia and nothing you'd remotely associate with a civilized group of immigrants. This usually happens at some ungodly hour of the night, when all of their job-holding, self-supporting neighbors are trying to catch their zees.
On more than one occasion, I have had to go out there and politely request that they tone it down a bit. On others, I have had no other choice but to report them to the police. Either way, it is usually without result. But at no point have I ever threatened them with violence, in spite of their lack of consideration for me, my family, and the other neighbors. It really and truly burns me up when they do this, but it's something I always find myself having to relent to in the interest of all parties.
As a CCW licensee, my level of patience MUST be at all times above that of the average citizen due to the extraordinary confidence my state has vested upon me. I am EXPECTED to excercise more restraint than most. There is no such thing as "fighting words" in my book; no such thing as "the right to preserve my honor". If the imps jump over the fence and attack me without provocation, they'll be pushing up daisies before they've had a chance to soil their pants. At the very least, it'll be weeks before they can walk again and take solid foods. But until that happens, I must have done everything to prevent it.
I don't know if you're a permit holder, but I would expect no less of you if you were not. All I can say, in your case, is that giving the stooge his due---which is really not all that much if you think about it---would be the best course of action. That is, be of good cheer and give in to his relatively mild request (for low volume). You have nothing to lose and everything to gain.
In the end, it'll prove far less expensive than going to court and a hell of a lot easier than you or him sorting out your teeth.
That said, I wish you the best.
- Rick